App Development Contract

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App Development Contract

A Brief Introduction of App Development Contract

In the times we live in, it has become extremely common for big organizations to develop their product’s application. IOS and android both mobile applications are in high demand. With the increasing demand in the apps, the number of developers required is also increasing. Companies have two ways to hire developers.

They can hire permanent developers, or they can hire someone on a contract basis, which is also commonly known as a freelance basis. It is always better to hire freelancers as it is less expensive for organizations. Freelancers, too, like to move on to another project after finishing one.

Another name for App Development Contract is App Development Agreement, Mobile App Development Contract, and IOS Developer Contract. The agreement is further segregated into two types- Technology Assignment Agreement and License Agreement

Who Takes the App Development Contract?

As mentioned above, the App Development Contract is signed by a freelancer who knows how to develop IOS apps or Android apps and the client. The client can be an individual or a big organization. There is always an option of hiring a full-time developer, but the client may prefer a freelancer for the benefits of it. Both parties are required to understand all the terms and conditions of the contract.

Purpose of the App Development Contract

In the absence of a written agreement, two parties orally decide on the terms and conditions of their business relationship. An oral agreement, however, can lead either of them in big trouble in the future. It also increases the risk of confusion and misunderstanding. Further, this could lead to a legal battle between two parties that can get extremely stressful and time-consuming.

So here are some pointwise reasons to sign a mobile app development contract template –

  • It includes all the details related to the scope of work
  • It outlines all the details related to compensation
  • It tells both parties their responsibilities and obligations
  • It makes the business deal legally binding
  • It secures and protects both parties
  • It ensures there are no unnecessary legal battles and confusion
  • It ensures all timelines are followed

Contents of the App Development Contract

A mobile app development contract must include the basic details, like any other agreement.

  • Basic details include the names, addresses, phone numbers, etc. of both the parties. The agreement must also add the bank details of the freelancer.
  • Further, the agreement must specify the scope of work. It should be detailed. It should be clearly written, so there is no confusion regarding the deliverables.
  • The agreement should define the work details- end-to-end design and development process, developments, the app delivery during the submission process, the revisions and changes to be made, acceptance to the app and payment details.
  • It should also specify the terms post its release like the warranty and user support to be provided.
  • In accordance with the good industrial practice, it should also mention Legal clauses like intellectual property rights, display of work, Payment schedules, etc.
  • The list of deliverables can also be written with the deadlines.

There should be an elaborate section of compensation. It should include the mode of payment, time, etc. The agreement must include the details of governing laws. Further, it must include important clauses such as force majeure, confidentiality, termination, etc. It is extremely important for both parties to know in what circumstances they can terminate the agreement.

How to Draft the App Development Contract?

To begin drafting a mobile app development contract, both parties need to understand what they want from each other.

The language of the agreement must be very simple and comprehensible. In case both parties don’t want to get into the making of the contract, they can also take the help of an expert who can help them draft the agreement.

It should ideally define

  • Scope of work: Define the details like platforms, programming languages, milestones, frameworks, solutions, man-hours, schedule, software used, guarantees, etc.
  • Price/Payment: Whether it is on a fixed-price or on a time and material basis should be defined.
  • Intellectual property rights: The contract should state a written transfer of ownership for a final product, work results, and components. 

In an App Development Agreement, it is important that both parties negotiate on the deliverables and compensation. It is understandable that the client wants to get the work done at minimum expense. However, he must always realize that for good and satisfactory work, it is important to pay the right amount. Negotiations should be made maturely and keeping everyone’s interest in mind.

Benefits & Drawbacks of the App Development Contract

There are various benefits of signing an App Development Agreement. A well-drafted agreement can protect both parties.

Here are a few pointwise advantages of it –

  • The agreement lists down all the responsibilities and obligations of both the parties
  • It protects both the parties
  • It provides safety to both the parties
  • It provides legal remedies
  • It ensures there are no confusion and misunderstanding
  • It provides the freelancer with an opportunity to work from wherever he likes
  • It ensures all the details regarding the business relationship are documented in one place

A well-drafted agreement is bound to help all the involved parties and doesn’t have any disadvantages.

What Happens in Case of Violation?

In case of any violation, both parties can refer to the terms and conditions of termination. The mobile application development agreement can be referred in case of any confusion. While drafting the agreement, parties can also add the name of mediators. Mediators can help the parties resolve conflicts(1). However, in the case of any bigger issue, parties are well within their rights to approach the court and take help. For each state, there can be different governing laws. Parties must study the governing laws before signing the agreement.

An App Development Contract is an extremely important piece of document that ensures the work is done smoothly. It protects both parties from unnecessary confusion and conflict. It must be drafted with full precaution and care. Alternatively, you can also consult an expert to help you draft the agreement.